Print sector's Q1FY24 ad revenue soars, industry foresees surge in profits in coming quarters

As the April-May-June quarter of FY24 comes to an end, print publications stand out with a strong rise in advertising revenues. Both circulation and advertising showed consistent year-on-year growth, boosting their outlook and optimism for increased revenues and profits in the coming quarters.

Anticipating a boost in revenue, fueled by lowered newsprint costs, reduced inflation and increased profits, the sector appears poised for growth.

DB Corp has reported an over two-and-half-fold jump in consolidated net profit at Rs 78.75 crore in the first quarter ended June 30, 2023, riding on robust advertising revenue growth.

The company had posted a consolidated net profit of Rs 31 crore in the same period last fiscal, DB Corp said in a regulatory filing. Consolidated total income during the period under review stood at Rs 573.6 crore, as compared to Rs 499.38 crore in the corresponding quarter last fiscal.

DB Corp Managing Director, Sudhir Agarwal, said, "As global economies are making a slow recovery from their inflationary pressures, the Indian Economy, especially the non-metro markets continue to see rapid growth. The print sector has been on the uptrend for the past few months and this is likely to continue.

While English language print has been struggling with sluggish demand, regional newspapers seem to be faring better, he added.

"Along with ad revenue growth we have been focused on cost optimisation and over the last 4-6 months have also been helped with easing newsprint prices. This has helped us deliver our fifth quarter of consistent growth across all segments and are confident of continuing this trend in the forthcoming quarters," Agarwal said.

Total expenses in the first quarter were at Rs 469.97 crore, as against Rs 457.3 crore in the same period a year ago.

The company, which publishes newspapers including Dainik Bhaskar, Divya Bhaskar, Divya Marathi and Saurashtra Samachar, said the resurgence in print media continues to dominate all forms of media as the most trusted source of news, and this resurgence has resulted in a strong fillip as advertisers look for the best avenue for their marketing spends.

"Print advertisement continues to register strong revenue growth of 24% year-on-year for the last five quarters from Rs 1,351 crore to Rs 1,675.5 crore," the company said.

Advertising revenue in the first quarter grew by 17.2% to Rs 394.6 crore, as against Rs 336.8 crore in the corresponding period a year ago, it added. Circulation revenue grew by around 4% to Rs 119.9 crore, as against Rs 115.6 crore in the same period last fiscal.

Newsprint prices continued their downward trend in Q1 FY24, DB Corp said, adding "We are hopeful that this trend will continue based on our assessment", the company said.

Furthermore, the company said that for the past three years, the digital business has been a key focus area and an important pillar for future growth of our business and this focus has been translated into strong gains.

Meanwhile, Jagran Prakashan (JPL), in its financial result for Q1FY24, reported a positive trajectory with 8.4% increase in PAT, which stood at Rs 43.89 crore compared to Rs 40.50 crore in Q1FY23. Additionally, the company reported advertising revenue of Rs 309.37 crore, reflecting a rise of 1.5% from Rs 304.92 crore in the same period last year.

Operating revenues stood at Rs 454.58 crore, showing a marginal increase of 0.02% compared to Rs 454.47 crore in Q1FY23. Circulation revenues amounted to Rs 95.13 crore, reflecting an increase of 1.8% from the Rs 93.42 crore reported in Q1FY23.

Other operating revenues totalled Rs 50.07 crore, compared to Rs 56.13 crore in the previous year. Digital Revenue was noted at Rs 20.43 crore, slightly lower than the Rs 20.78 crore reported in Q1FY23.

Operating profit reached Rs 69.42 crore, down by 10.0% from the previous year's Rs 77.15 crore.

Profit before tax (PBT) was reported at Rs 56.76 crore, indicating a growth of 4.8% from Rs 54.18 crore in Q1FY23.

Mahendra Mohan Gupta, Chairman and Managing Director, JPL, said, "The company maintained the same revenues and profits as it reported in Q1 of the previous year. Going forward, however, I expect improved revenues particularly in H2 benefitting from lower inflation and increased government spending and even more improved profits due to increased revenues coupled with newsprint cost savings due to moderation in prices which is not yet fully reflected in operating results."

"Outdoor and event businesses maintained robust performance over the last some quarters and have been contributing to the overall profit of the company. There was some fall in revenue during the quarter in comparison to Q1 of the previous year due to a shift in strategy to focus on more stable and profitable revenue streams which would continue. These businesses maintained profits of the last year despite a fall in revenue in Q1," he added.

Gupta said that digital business had nearly the same revenue as in Q1 of the previous year partly because of unfavourable market conditions and partly because of inability to monetise the consumer base to the expected level.

"However, operational metrics remain strong and I hope that the team will work towards generating revenues commensurate with the user base and the costs most of which are fixed in nature," Gupta said.

On the other hand, HT Media said its consolidated net loss narrowed to Rs 18.98 crore for the first quarter ended in June 2023. The company had posted a net loss of Rs 41.80 crore in the April-June quarter of the previous fiscal, HT Media said in a regulatory filing.

Its revenue from operations was down 6.34% to Rs 393.42 crore during the June quarter against Rs 420.09 crore in the corresponding period of the previous fiscal.

HT Media's total expenses declined 6.16% to Rs 466.14 crore in the first quarter of FY 2023-24. However, its total income in the June quarter was up 3.12% to Rs 445.17 crore.

HT Media Chairperson and Editorial Director Shobhana Bhartia said, "Overall, our performance in Q1 23-24 has seen an improvement. While revenue is muted, profitability has expanded on the back of continued cost streamlining and easing commodity prices."

HT Media's revenue from 'printing and publishing newspapers and periodicals' was down 6.93% to Rs 323.55 crore.

"Circulation and advertising grew on a year-on-year basis in print, while in radio, non-FCT and value-added solutions drove the growth," she said.

Rising media spending by companies, growing consumer demand, more government spending and relative easing in inflationary pressure, all augur well in the near term for the Print, Radio and Digital sectors of the M&E industry, which should benefit the company, Bhartia added.

"We are focused on achieving profitable growth in our core businesses while expanding into new areas such as OTT," she said.

Info@BestMediaInfo.com